Fintech Consulting & Licensing Support in Canada

Canada has a developing fintech ecosystem; the Canadian government, through numerous grants, aids innovation and establishment of fintech businesses within the territory, whether you are a fintech company dealing in cryptocurrency and exchange of virtual money or a payment solution provider, etc. Canada could be the ideal place for you to do business. Enterslice can help make this a reality for you. Our team of fintech consultants will help you find your place in the Canadian financial marketplace.

Understanding financial technology

Today, any technologically enabled financial innovation that might produce new business models, applications, processes, or products that can leave an effect on the financial market is known as a fintech business model. Due to stringent consumer protection rules, these fintech business models can't be part of the public domain without obtaining authorization from the regulatory authorities; this authorization generally is in the form of licensing, which gives the right businesses to have innovative fintech models to introduce in the public domain. Each nation has separate policies regarding fintech licensing, and an entity willing to obtain the same needs to register them according to the local laws. These licensed fintech entities rely on electronic channels for their distribution, making cross-border interactions and outsourcing products easy, converting the global market into a unified marketplace.

With Enterslice, Embrace Your Journey as a Fintech Licensed Company By

Novel Approach

Keep the novel approach right from seeding your business model to converting your fintech into a fintech giant. Enterslice will be for your support throughout this novel journey.

Innovative ideas

Innovation is the key to a thriving fintech business, and Enterslice will support your fintech in creating innovative business plans.

Original and creative outlook

The fintech industry needs original ideas and a creative outlook to make a business successful, which is possible when you have a partner like Enterslice who, with its team, can aid you with a totally different approach to make your business a profit-earning fintech giant.

Enterslice Fintech Licensing Services Making Your Business

Aspirational

We understand that your business is a matter of social prestige for you, and Enterslice willfully aids any business that aims to make a strong foundational business model fulfilling your aspirations of a successful fintech business.

Achievable

Any business model survives the tough wind of the market only if it stands on an achievable and viable working model. Enterslice will assess the risks associated with your business model so as to make it workable in the public domain.

Sustainable

A business should be built on a sustainable foundation, which could be a business entity in the marketplace for time immemorial. Enterslice can aid you in achieving this longevity, which is only possible by advancing your profit-making capacity.

Desirable

Make your business meet the expectations of the customers and address their unmet needs, along with creating a value proposition for your customer base.

Global Crypto Compliance 2024: Regulations in Every Country

Global Crypto Compliance 2024 provides a comprehensive overview of cryptocurrency regulations across the globe.

Download PDF

Fintech Landscape of Canada

Canada is a dynamic fintech marketplace, and Enterslice knows the whereabouts of penetrating this comprehensive market. Our goal and objective is to make you understand the fintech ecosystem of Canada, which could help you gain strategic investments so as to create a strong foundation for your business's success.

Thriving Fintech Hubs

four thriving fintech hubs in Toronto, Montreal, Calgary, and Vancouver, which soared fintech investment of $6.4 billion in 2021 with 162 deals. Currently, Canada has more than 1200 fintech companies, with Toronto being its largest commercial hub, and it is ranked 4^th in the global AI index for its global competitiveness in AI implementation, innovation and investment.

Largest Digital Investment Marketplace

According to the statistics published by Statista, Canada is one of the largest digital investment marketplaces, with an annual investment of US$ 3.89 billion in 2023, and its digital assets market is expected to show a revenue growth of 36.7% by 2024.

Technology Friendly Ecosystem

With each passing year, technology and its alignment with financial institutions are becoming an integral part of the Canadian financial ecosystem.

Welcoming Towards Foreign Fintechs

Although important regulatory barriers restrict the entry of new players in Canada's financial setup, it has begun to expand its framework to welcome foreign fintech companies, which, when accomplished, will transform Canada into the world’s major fintech hub.

Enterslice License Assistance Services

1. Application preparation communication support & payment infrastructure assistance

   We will make a license application on your behalf and prepare all annexures so that you gain the license in one go. Your fintech model for Canada must have a viable payment infrastructure due to the intricacies that finance with technology business holds; Enterslice will assist you in creating a susceptible payment infrastructure.

2. Compliance and underwriting support

   Policy interpretation and administration are both important when involved in the fintech licensing process because one mistake can lead to a delay in procuring a license, which will not be the case when the team of legal and policy experts of Enterslice are at your rescue.

3. Sandbox assistance

   A fintech business has a high chance of getting a license if it is part of the sandbox, and becoming a sandbox entity in itself is a tough nut to crack. Enterslice could make this possible for you. With our assistance, test your product in the sandbox, and we will assess and audit its growth pattern.

   Understanding the Fintech Model of Canada

   Canada's fintech sector poses attractive opportunities to startups and foreign investors. While traditional financial institutions focused on satisfying the government and profit-making, these new fintech setups are focusing on enhancing the user experience and profit-making due to being more technologically equipped than their traditional counterparts.

   If we go back to the history of fintech in Canada, we will observe that in comparison to other countries, Canada had a much more cautious approach while introducing the dynamics of fintech into its territory. Initially, the financial sector of Canada was dominated by five major banks, namely the Toronto-dominion Bank, Royal Bank of Canada, Bank of nova-scotia, Bank of Montreal, and the Canadian Imperial Bank of Commerce, and these banks had a monopoly of 85% of the Canadian banking business.

   Canada provides a diverse ecosystem for a fintech business to breathe, with the expansion of online lending platforms, robo-advisors, and e-payment processing units. It is the world's biggest innovator in blockchain technology and cryptocurrency and is home to many digital-first banks.

   The advisory committee on open banking through the federal government appointed Abraham Tachjian as the open banking lead in March 2022 to design a framework in which third-party financial service providers are given open access to customer banking, transactions, and other financial data from banks and non-bank financial organizations through an application programming interface.

   These major initiatives by Canadian regulatory authorities are a step toward welcoming foreign entrants to Canada's fintech market, which is why it is beneficial for finance-driven industries to consider the opportunities existing in the fintech industry by obtaining a fintech license in Canada.

   Key Regulators for Fintech in Canada

   The structure of government in Canada is federal, due to which the regulations pertaining to financial services are controlled under the ambit of two authorities: one is federal, which has control over the entire territory of Canada, and the other is the provincial laws of each province existing in Canada.

   1. Federal Regulators

   In Canada, the activities of banks, federally chartered trusts, and loan companies are regulated by the Minister of Finance of Canada, the Office of the Superintendent of Financial Institutions, the Bank of Canada, the Canada Deposit Insurance Corporation, and the Financial Institutions Supervisory Committee.

   • The Department of Finance is responsible for any financial regulations in the territory of Canada. The office of the Superintendent of Financial Institutions keeps an eye on the day-to-day transactions of the financial services sector. Although it is a government agency, it works independently and administers the relevant federal legislation. The basic function of this authority is to develop rules and legislations and give regulatory approvals for certain types of transactions.
   • Consumer protection of financial products and the protection of merchants are the responsibilities of the Financial Consumer Agency of Canada. The regulations for banks and branches of these banks, trusts, and federal loan companies come within the legislation of the superintendent of financial institutions, which makes such examination which could give a transparent idea about the business and whereabouts of each institution.
   • The Bank of Canada manages the credit and currency fundamentals, and the clearance and settlements of payments are operated by two systems, mainly the large value transfer system and the automated clearing and settlement system.
   • To establish facilities for the interchange and settlement of credit claims, the Canadian Payments Act was designed, which makes it compulsory for any banking institution to register to obtain membership in Payments Canada. Any other financial institution that accepts deposits through cheques can also register itself within Payments Canada if it fulfils the requirements of the Canadian Payments Act.
   • To maintain the insurance of the deposits in the banks and other financial institutions registered under Payments Canada, and if accepting retail deposits, they must register themselves under the Canada Deposit Insurance Corporation Act.
   • Fintech industries that aren’t banks trusts or federal loan companies will have general applications to federal and provincial laws such as the Competition Act of Canada, the Personal Information Protection and Electronic necessary papers Act, Canadian anti-spam law, proceeds of crime(money laundering), and terrorist financing Act.
   • Many financial as well as fintech companies are regulated by the financial transactions and reports analysis centre of Canada, the work of which is to receive the financial transaction reports voluntary information by legislations and regulations, compliance of the reporting entities, registry of money and its maintenance of the businesses existing in Canada.
   • The sanctions relating to terrorist financing and other financial crimes are dealt with within the ambit of the criminal code and the Special Economic Measures Act.

   2. Provincial Regulators

   Any financial entity regulated within the federal laws of Canada also needs to follow the rules and regulations enlisted in the provincial laws. The provincial regulations vary from the type of business model and the type of activity within which the financial institution functions.

   • The provincial securities commissions regulate the participants of the securities market at the provincial level, and this commission regulates the trading of securities, oversees that the registration of the entities is proper and as per the existing laws, educates the investors, and enforces national and multilateral instruments dealing in the legislation of securities.
   • The investment dealers and their registered individual staff are regulated within the industry regulatory organization of Canada and the mutual fund dealers are regulated within the ambit of Canada's mutual fund dealers association.
   • The Provincial Securities Act governs the portfolio managers and exempt market dealers under Canadian Securities Administrators (CSA) guidance. Even the individuals' and businesses' activities dealing with mortgage brokering are also provincially regulated except for the changes that might arise in the responsibilities of mortgage brokers from one province to another.
   • The Autorité des Marches financiers (AMF) is the financial authority of Quebac, the responsibility of which is to regulate the financial markets such as the insurance market, securities market, deposits market, and other institutions dealing with the distribution of financial products and services within this region.
   • In British Columbia, the Financial Institutions Commission of British Columbia (FICOM) is responsible for pension plans, real estate, mortgage brokers, financial institutions (including credit unions, insurance and trust companies), and the Credit Union Deposit Insurance Corporation.
   • In Ontario, the Financial Services Regulatory Authority (FSRO) has a mandate similar to FICOM in British Columbia, although the FASRO is also directly responsible for deposit insurance in Ontario.

   3. Regulatory Sandbox

   The Canadian securities administrators took the initiative to establish a CSA regulatory sandbox to support fintech businesses seeking to offer innovative products, services, and applications.

   • Firms that are part of the regulatory sandbox are allowed exemptive relief from securities law requirements, and their registration process through the same becomes faster and more flexible in comparison to the standard application.
   • Within this market, such business models that are innovative from the market perspective of the Canadian marketplace and are ready to be part of live environment testing have a business plan and can participate in the discussion of potential investor benefits.

    

   4. Activities Regulated Within Fintech in Canada

   Like other nations, Canada has introduced various schemes and activities that are technology-oriented and aid the landscape of fintech within the territory. These activities are subject to various provincial license requirements under the provincial securities and derivatives laws, especially if it is a foreign establishment.

   ·  Consumer Lending

   The obligations upon banks and other financial services at the federal level are dependent upon the nature of the activity they are conducting; banks and other financial institutions have the cost of borrowing disclosure obligations for mortgages, credit cards, and other types of credits.

   Within most provinces' provincial regulations, payday lenders are required to obtain licenses. In the provinces of Quebec, New Brunswick, Nova Scotia, and Saskatchewan, a lending license for consumer lending exists.

   · Collective Investment Schemes

   Provincial laws regulate investment funds within the Canadian securities regulations, and these include non-redeemable and mutual funds; investment fund manager registration is required for collective investment structures, including those that provide alternative finance products or services, including virtual currencies.

   Depending upon the nature of the regulated intermediary, there are national instruments that, within their ambit, include their reporting and conduct requirements, such as National Instrument 81-102 – Investment Funds (NI 81-102) and National Instrument 81-104 – Alternative Mutual Funds (NI 81-104) (which applies specifically to retail alternative funds), National Instrument 81-106 – Investment Fund Continuous Disclosure.

   · Alternative Investment Funds

   Any organization or an individual operating an alternative investment fund must comply with the registration requirements of such entities.

   Provincial prospectus decides the ambit of necessary papers and post-trade reports, and managers of conventional investment funds and alternative investment funds are all part of securities legislation.

   Additional regulations such as NI 81-102, 81-106, and 81-104 are focused upon alternative investment funds.

   · Peer-T0-Peer & Marketplace Lending

   Dealers and provincial securities regulators dealing in peer-to-peer lending businesses need to register themselves with the provincial securities regulators of the province within which they are operating their business.

   · Crowdfunding

   Fintech startups raising capital through crowdfunding come within the ambit of provincial securities regulations.

   Different provinces, by means of different regulations and instruments, manage crowdfunding within their territory. For example, the registration and prospectus exemptions for startup crowdfunding companies come within the ambit of Ontario Securities Commissions Ontario Instrument 45-506 startup crowdfunding registration and prospectus exemptions.

   Other provincial instruments are 45-108 for crowdfunding and multilateral CSA, 45-316 for crowdfunding registration, and prospectus exemptions permit early-stage companies and small businesses to raise limited capital through crowdfunding platforms. National Instruments 31-103 for registration requirements, exemptions, and ongoing registrant obligations are within NI31-103. All these national instruments are within the ambit of provincial securities regulators.

   The new regulation of CSA, i.e. the national instrument 45-110 startup crowdfunding registration and prospectus exemptions, is an attempt to harmonize the national framework in relation to crowdfunding-related rules and regulations.

   · Invoice Trading

   Provincial laws and FINTRAC obligations regulate invoice trading in Canada and, if carried out by any banking entity or entity affiliated with the bank, will be subject to federal banking legislation.

   Provincial loan and trust legislation applies to the services involved in extending loans and trust services to the public.

   · Payment Services

   Registration, risk monitoring, and enforcement of payment services-related providers come within the ambit of the retail payments supervisory framework. Any person who functions as a payment service provider within the territory of Canada and performs retail payment activity fulfils the geographic scope established by the Act and is not an excluded entity within RPAA. They can register themselves as a payment services entity within the Act.

   · Open Banking

   The government of Canada established an advisory committee on open banking, the focus of which was to outline a consumer-focused framework for implementing secure open banking in Canada. The purpose behind this was to give customers the right to control, edit, manage, and delete information about themselves and decide what, how, when, and to what extent information about them is to be communicated to others. This policy is to be implemented by including the digital charter and Bill C-11 of the Consumer Privacy Protection Act.

   The aim of introducing an open banking system in Canada was to improve both the economic outcomes and consumer welfare. It shall enhance the well-being of the consumers by giving them access to new and innovative financial services that are secure, efficient, and consumer-centric.

   · Robo-Advice

   Different provinces of Canada regulate the robo-advising activities as per the regulatory requirements pertaining to the same.

   Robo-advising is regulated under the national framework of Canada within the ambit of national instrument NI-31-103.

   CSA has issued certain guidelines, such as staff notice 31-342, for guidance for portfolio managers regarding online advice, which outlined the applicability of securities laws to online advisers.

   Obligations related to KYC obligations, due diligence requirements, and compliance reviews are required by the fintech companies providing robo-advising.

   Fintech Activities That Require License in Canada

   Either at the federal level or at the provincial level, when done by an entity requiring licensing to be authorized within the territory of Canada, these activities are accepting deposits Life, Property, and casualty-related insurance business, including acting as an insurer, underwriter, agent, or broker. Providing investment, fund management, and financial advice or engaging in investment management activities. Trading and distributing securities and other investments, including a broker or dealer. Dealing or trading in and administrating mortgages and mortgage lending while acting as a mortgage agent, broker, administrator, or lender. Giving money services including dealing in foreign exchange, transferring funds from one individual or organization to another using an electronic funds transfer network, cashing or selling money orders, and traveller's checks. Giving payday loans as a lender or broker, giving credit reports, collecting debts on behalf of another

   Helping you with Hassle-free License Procurement

   If you are planning to make your mark in the Canadian financial market either as a money services business (MSB) which has its own place of business in Canada, is incorporated in Canada, has a physical location along with the employees, agents, or branches but yet finding it difficult as to which regulation to follow, how to follow and are having difficulty in understanding the intricacies of federal and provincial norms or a foreign money services business (FMSB) which doesn’t have a place of business in Canada, no physical location, no employees, agents or branches but a very strong business model for foreign exchange dealing, remitting or transmitting funds, issuing or redeeming money orders or other negotiable instruments, dealing in virtual currency, and crowdfunding platform services, but even after having all this you are confused about how to penetrate the Canadian financial marketplace, if you have any of these models Enterslice will be your ideal partner, we have expertise in FINTRAC and PCMLTFA we will help you in becoming a registered fintech company of Canada.

   Aiding your licensing journey

   Obtaining a fintech license is a journey of its own, which is easy to stage when supported by the right set of advisors, connect with Enterslice and have the appropriate licensing support from timing your fundraising to finding potential investors for you, formulating your financial statements, making compliance strategy and plans to legal aid and assistance, Enterslice could be your one-step solution. Plan your fintech journey with us and make your distinctive place in the Canadian fintech marketplace.

   Perks Of Being a Licensed Fintech Company of Canada

   1.Reputable Marketplace

   The banks and other financial institutions of Canada are considered highly trustworthy. Canadians generally have high faith in their financial institutions and consider them to be stable, secure, and trustworthy. Any fintech company would like to be part of such a setup, which has a customer base and trust that ultimately aids in profit making.

   2.Innovative Marketplace

   In comparison to any other nation, it is easier for a fintech company to partner with a bank in Canada. This approach of traditional banks ultimately results in the origin of innovative banking practices, which are profitable to the consumers.

   3.Safe Marketplace

   Though the companies registering themselves within the fintech framework of Canada need to comply strictly with rigorous regulations, those who do so also enjoy the perks of being a registered entity. For example, the OFSI assists the registered banks with disaster recovery plans in conjunction with the Canada Deposit and Insurance Corporation (CDIC) so as to assess the issues at the nascent stage so that in case of any conflict, the fintech company could be brought back to a level field and full compliances in no time. This helps strengthen the bank's overall financial position.

   4.Technological Infrastructure

   Numerous tech giants have already established entities in Canada's financial market, making the market sprint on a strong technological foundation; becoming a part of a driven market is a dream of any entity willing to penetrate a new financial segment or market. This is a perk for a new entity applying for a license within the fintech market in Canada.

Difficulties Faced By Autonomous Fintech in Canada

1. Director Residency

In most of the provinces, as well as while incorporating a fintech business federally, it is required that at least some directors of the fintech entity must be the residents of Canada, which at times is challenging for a startup constructing a business, making a foreign entity part of a group of directors automatically involves risks as well as searching for someone legit enough for such a crucial role becomes difficult.

2. Lengthy Process

There are many regulatory processes that fintech companies must comply with before establishing themselves in Canada. The biggest challenge is complying with federal as well as provincial norms, which at times differ from one another. Dual regulations for setting up one organization and meeting the specific criteria and requirements to incorporate the company in Canada become a lengthy and time-consuming process.

3. Restrictions upon Business Activities

In general, the registered activity for a certain activity cannot broaden their horizon and need to limit themselves to the activities for which they have obtained a license. If a bank obtained a license to conduct banking business, then they cannot deal with securities or insurance business, nor can they act as trustees or engage in personal property leasing activities. Separate permissions are required for separate businesses, making it tough for one business to go through the same lengthy process of Paper works required for registration, varying at both federal and provincial levels.

4.Tedious Reporting Requirements

Applicable regulations at the federal and provincial levels require reporting of a series of monthly, quarterly, and annual reports to ensure that they are maintaining compliance with the regulations which at times is difficult for a newly formed entity to comply with on its own.

5. Strict Regulation

In Canada, both at the provincial and federal level, the norms of licensing are such that the focus of regulations is primarily to protect the consumers, which, along with compliances such as maintaining the minimum levels of regulatory capital and complying with the membership of Canadian payment association becomes difficult especially for a startup to follow through on its own while applying for a license.

Customized Fintech Licensing

1. Sandbox Assistance

If you are a fintech startup with an innovative business idea that is ready to penetrate the Canadian marketplace but are dicey about how and when to introduce it to the market, take the help of Enterslice and our team of sandbox support will help you register in the sandbox program of Canada where you can test your product can access the risks involved, mitigate such risks, make it market ready and then successfully introduce it in the public domain.

2. Compliance and Underwriting Support

With the help of Enterslice, compliance management, and the assistance team, you can reduce the chances of frauds and losses occurring due to such frauds. We will help in building a safe organization for you that attains the trust of its consumers. We have an expert team of underwriters who will assess for you the probable future risks and will formulate strategies to mitigate such risks, keeping you in the loop.

3. Application Preparation

To be a fintech entity in Canada, the foremost is to register your company as per the established legal framework of Canada, for which you need support through the legal landscape for registration, including the business model, place of office, infrastructure, and FINTRAC registration. Enterslice can assist you in preparing an ideal application that will ensure you a FinTech license. 

4. Communication Assistance

Our experts have been dealing with the Canadian market for years and know its inner dynamics. We will assist you in formulating necessary papers and can also establish third-party communications, taking the aid of local residents eligible to be at the core of the organization. We will aid the building blocks for your financial service by aiding you in ID Verification, KYC checks, sanctions screening, match list checks, jurisdiction selection, and structuring advice.

Fintech Business Development

1. Commercial Agility

An agile business provides the right balance to the fintech entity. With the support of Enterslice, you can achieve this right balance.

2. Profitability

The reason behind the establishment of any business is to generate profit, which makes any business stand up front in the marketplace. Enterslice could make you a compliant fintech business trustworthy enough to attract quality clients and earn your reputation with the support of Enterslice.

3. Focusing On Essentials

Attaining the niche of any marketplace is only possible if the focus is on giving the right foundation to the business, which is obtaining licensing in line with the regulatory framework, which will shield the fintech and make it a standard and protected industry. We will assist you in making your core business accessible.

4. Continuous Delivery

A constantly updated fintech is the demand of time due to the continuously changing technology phenomenon. Licensing involves concentrating effectively on each dynamic, which is only possible if you have the right consultant to support and aid your journey.

License affixtures services

Enterslice will develop a full package of internal necessary papers for your assistance, including your go-to written compliance policies and procedures, the compliance and training programs you need to apply before applying for a license, and a full proof channel for risk assessment, providing you with our expert compliance officers. Our team of legal experts will make simplified policies for your organization as per your business model. We will analyze and manage your financial and IT-related necessary papers, making the process of procuring a license accessible. Currency management and obtaining accounts at credit unions are two of the crucial aspects of establishing a fintech business in Canada. We will assist you and will make you partner with the leading card issuers, commercial foreign exchangers, and cryptocurrency liquidity providers. With the help of Enterslice, you will be able to launch your business faster and drive its revenue growth, which will help you scale globally by unlocking new revenue streams.

Compliance and Underwriting services

With the help of Enterslice, compliance management, and the assistance team, you can reduce the chances of frauds and losses occurring due to such frauds. We will help in building a safe organization for you that attains the trust of its consumers. We have an expert team of underwriters who will assess for you the probable future risks and will formulate strategies to mitigate such risks, keeping you in the loop.

Business Description Statement Formulation

1. Business Statement

A business description statement is one of the most relevant licensing requirements because it describes the nature of the financial services the business is planning to operate.

2. Statement precision

The business description must be formulated with sheer precision because this description sets out a rough idea in the minds of the regulators about the future of the new entity, its survival, and its existence in the fintech marketplace.

3. Expert assistance

Enterslice has a team of experts with 10+ years of experience in understanding the fintech industry dynamics, and they know the whereabouts of the market's needs.

4. Innovate and achieve

Our team will help you form an innovative and achievable business description most suitable to the idea upon which the entire structure of your business lies.

Our success story

We have 10+ years of experience in the fintech domain, along with licensing, company establishment, and other legal compliances. Our journey is full of success stories that we achieved through these years by making the right decisions for a budding or an established fintech business in Canada.

Our commitment to you

1. Goal-based outcomes

At Enterslice, we value our clients' time and resources. Therefore, ,we derive goal-based strategies to streamline our operations to achieve the same.

2. Consistency

We have a dedicated team of experts who know how to remain committed and objective, along with the skill to make a business settled.

3. Balanced approach

We aim to achieve the right balance for our clients' businesses, especially when it concerns the fintech industry.

Hassle-free Fintech license procurement with Enterslice Fintech licensing services

Fintech licensing services must be availed by every fintech entity, especially when establishing it in a foreign country, because the rules of licensing vary worldwide. A potential and strategic fintech licensing plan ensures easy procurement of license because in most of the nation, rejection of the license results in delay and add-on controls and compliances.

With the help of our consultation and advisory, you can focus on building the core of your fintech business while we will ensure the developing license compliance per the regulatory framework.